## Facts

- The Classified Employees Association (CEA) represented noncertificated employees of the Matanuska-Susitna Borough School District, including custodial workers.
- CEA and the District were parties to a collective bargaining agreement (CBA) effective July 1, 2005 through June 30, 2008.
- The CBA established a multi-step grievance process culminating in final, binding arbitration.
- The CBA defined a “grievance” as a claim affecting work conditions caused by misinterpretation or inequitable application of District personnel policies, and/or the terms of the CBA.
- During bargaining, the parties discussed outsourcing but the final CBA contained no express provision addressing outsourcing.
- The District decided to provide custodial services through an independent contractor rather than employing custodial workers, displacing bargaining-unit custodians.
- CEA asserted the outsourcing decision violated the CBA and sought to compel arbitration; the District denied any agreement to arbitrate outsourcing and treated it as a managerial decision.
- The superior court ruled for the District and refused to compel arbitration; CEA appealed.

## Issues

1. Whether the District’s decision to outsource custodial services was a “grievance” subject to arbitration under the CBA when the CBA contained no express restriction on outsourcing.
2. Whether a court may compel arbitration absent a reasonable argument that the challenged management action violates, interprets, or applies an identifiable term of the CBA.

## Decision

- The Alaska Supreme Court affirmed the superior court in a 3–2 decision.
- The court held the outsourcing decision was not arbitrable under the CBA.
- The court concluded CEA had not made a reasonable argument that outsourcing was prohibited or restricted by any CBA term.
- Because the dispute did not reasonably relate to interpretation or application of the CBA, the court declined to order arbitration.

## Legal Principles

- Arbitration is a matter of contract; a party may be required to arbitrate only disputes it agreed to submit to arbitration.
- A court deciding arbitrability must determine whether the asserted dispute reasonably bears on interpretation or application of the collective bargaining agreement.
- A broadly worded grievance/arbitration clause does not reach employer actions when the union cannot identify a plausible contractual basis showing the action violates the agreement.
- When a CBA is silent on outsourcing—especially after bargaining on the topic—courts are reluctant to infer an implied prohibition that would restrict management authority.
- Where the CBA limits arbitrators from adding to or subtracting from contractual language, compelling arbitration over a subject not grounded in the agreement risks allowing arbitration to create a new contract term rather than interpret an existing one.

## Conclusion

The Alaska Supreme Court held that a union could not compel arbitration of a school district’s decision to outsource custodial services when the collective bargaining agreement did not address outsourcing and the union could not reasonably connect the decision to a violation, interpretation, or application of any contract term.


Classified Emps. Ass’n v. Matanuska-Susitna Borough Sch. Dist., 204 P.3d 347 (Alaska 2009)